Paul Volcker

PAUL VOLCKER

Introduction

They were there: on the Hudson in New York, and in the gardens of the White House, as we will note the author of The Earth is flat , although at this point is flattened and shaved. When this perfect storm will pass to focus the direction of the economy of the future. And that may be an even more dangerous moment. We are at the epicenter of a systemic failure. The whole system is in crisis: economic, political, social, cultural, global human system. Everyone is suspicious of everyone. And indeed it is no wonder. In 1987 Ronald Reagan took the Fed Paul Volcker and put in place to Alan Greenspan. Volcker had achieved the objective of any central banker: reducing inflation and took from 11% to 4%. But it was not enough. Reagan wanted more. Because Volcker refused to deregulate financial markets (Volcker, 2010). And Reagan wanted a firm believer in the free market, a devotee of the objectivist philosophy and fanatical, as in casting the role was for Greenspan. Perfectly satisfied with what Reagan wanted. It's been over twenty years since Paul Volcker stepped down as chairman of the Federal Reserve Alan Greenspan to take his witness. The first Democrat Jimmy Carter and Republican Ronald Reagan, then trust him to lead the charge of the monetary policy of the country between 1979 and 1987.

Discussion

Very few in the Oval Office were actually aware that the appointment of Volcker would be the most important of the Carter presidency: U.S. and the world was preparing to attend the beginning of a new era. Under its mandate, the Federal Reserve profoundly changed the landscape of American life, transformed the terms of any transaction in the national economy and ushered in a new order. His election came reluctantly by Carter and it was almost by accident, to the political and financial panic that gripped the U.S. economy in the late 70s. Inflation was then above double digits in 1981 and reached its peak at 13.5%. Investors had lost all confidence in Washington's ability to keep prices under control.

The signing of Volcker, then chairman of the Federal Reserve Bank of New York, managed to calm the markets. Jimmy Carter had put the U.S. monetary policy in the hands of someone who was willing to sacrifice almost all the jobs of millions of Americans, including the presidential chair of the White House (Volcker, 1994). All to reach a final and only goal: to keep prices in check. As Robert Redford in The Whisperer horses whispered Volcker inflation until it got to train her. Volcker got combat stagflation-zero economic growth and inflation through the roof, which had taken over the economy of the United States in the late 70s. Limited the money supply to markets and conducted an aggressive policy of interest rate hikes by raising rates to historically high levels. His hand allowed him hard down inflation to 3.2% in 1983. The initial effect of this movement was economic ...